Page 143 - RusRPTOct21

Valuation. Our DCF model with a WACC of 11.0% and COE of 13.4% returns a 12-mo TP of RUB 1,500/GDR, implying 46% upside potential to the current price and so we initiate coverage with auy recommendation. The company adopted a dividend policy in June 2021 and we think it could sustainably move to a 100% payout. In 2021, it implies a dividend yield of 10.7%, including announced payments for FY20 (EUR 76mn, record date on 27 September, 7.1% yield) and 1H21 (EUR 38mn, 3.6% yield), scheduled for December 2021.
Risks. Weak utilisation at the Pravda maternity hospital, Moniki and Kolomna clinics; improper integration of the Zhukovka rehabilitation centre and geriatric centres into the EMC ecosystem; the cancellation of or cuts to the MHI-quota.
143 RUSSIA Country Report October 2021 www.intellinews.com